Getting On With Governing

August 24, 1974

Insofar as goodwill can carry us through the next two years, the future is promising. Mr. Ford’s geniality, his informality, his sincerity and determination to do right lift the spirit. Watching the broad smile that never left the face of the Speaker of the House as he listened to President Ford address Congress last week, one knew that Mr. Nixon had really departed, that we had in his place a leader who is liked, who says what he means and means what he says. When the President spoke the word “candor,” it was as if one had suddenly met a long-lost and cherished friend. There was confidence that Mr. Ford’s joint venture with Congress will be managed with honesty and with civility, which is reason enough for satisfaction. But we have been given as well an unprecedented demonstration of how smoothly and speedily a mid-term transfer of executive power can occur. The constitutional process had never been so tested; it worked magnificently. Though it was becomingly modest for Mr. Ford to refer to himself as an unelected President, it Is worth remembering that he was not picked to be Vice President at four in the morning by a harassed presidential nominee and a handful of weary advisers. Under the 25th Amendment, Mr. Ford was the first vice presidential designee to be questioned in public hearings, and his elevation to the vice presidency was confirmed by Congress. The legitimacy of the succession is indisputable, as indisputable as the new President’s instinct for sounding the right human note.

When, however, we turn from the text, as distinct from the tone of Mr. Ford’s comments to Congress on inflation—“public enemy Number One,”—we are not so satisfied. The planned summit meeting of economic experts plus congressmen and the President may produce some practical remedies for what ails us. We trust so, for the remedies Mr. Ford advanced last week were not reassuring. Raging inflation, the narrowing of job opportunity for the young and for blacks, soaring interest rates, the decline in productivity, the hardships of the poor and near-poor won’t be cured by Calvin Coolidge frugality. It may be that Congress must “cut the cost of government [and] restrain federal spending,” but that by itself is a prescription for further decline, especially if the cuts are mostly in nonmilitary spending. Likewise nothing in recent history should lead anyone to think that “jaw-boning” can moderate the upward push of wages and prices. The President’s suggestion that Cost of Living Council be revived to “monitor wages and prices to expose abuses” is more shadowboxing. Of course one ought not pass final judgment on Mr. Ford’s economic program before it has been developed in detail. He will be listening to new advisers and to Congress, and as a result the President may be moved to break away from the orthodoxies and do what’s needed to kick up production and income and get prices down. But that will not be done by imitating his predecessor, by slicing federal expenditures and letting everything else more or less rip. The alarm bells have been ringing loud enough to wake the dead. Inflation, running close to 13 percent a year, won’t fall below double digits before 1975, if then. Unemployment, now at 5.3 percent, is expected to go above six percent in the next few months. The government’s key price index, an indicator of what the consumer will have to pay in the immediate future, rose at an annual rate of more than 44 percent last month, the second largest increase in 28 years. Commentators may compare Mr. Ford to Truman or Eisenhower, but his task is perilously similar to Franklin Roosevelt’s. Three weeks ago the Commerce Department refused to label the first two quarters’ decline in production this year as a “recession”; department economists now admit that that is precisely what the country may have in store for it in the next two quarters. And that prospect is not brightened by the latest figures on agricultural production: harvests will be smaller than expected and prices higher.

Earlier this summer, at the invitation of House Speaker Albert, a group of economists reviewed the economic situation and made some proposals. The economists were J.K. Galbraith, Otto Eckstein, Walter Heller, Leon Keyserling, Paul Samuelson, Charles Schultze, James Tobin and Robert Lekachman. They noted that interest rates are at an all-time high, that the financial system is in serious danger, and that “real wages have suffered large declines while profits have been inflating in a nonsustainable way.” Housing construction has practically come to a halt. There is threat of massive withdrawals of savings from thrift institutions. The economists do not call for easy money but they do suggest a less repressive monetary policy, for while large corporate buyer can usually meet their credit needs, small business, home builders and buyers cannot. The Federal Reserve Board, they say, should lower interest rates gradually. Implicit in the analysis of the majority of the group is a recognition that although large corporate interests may be hurting from stagflation—recession and inflation—the indigent, the lower- and moderate-income families and those with fixed incomes like the elderly, are hurting worse. They call for a new incomes policy to achieve “responsible price and wage behavior for the largest private economic units,” which is to say tax reforms that give relief to the less affluent. Labor, they say, can only be expected to reduce its wage demands if it gets an increase in real income on each paycheck.

Galbraith and Lekachman take a stronger line. They do not think, nor does this journal, that our upset can be cured by tea and toast. In their judgment, if the government means to get a firm hold on inflation without allowing the economy to sink into a deep depression, there have to be mandatory wage and price controls. In addition they recommend a stiff surtax on upper incomes, a solid increase in the corporate income tax, an excise tax on big automobiles and on air conditioners and other heavy users of energy or scarce material for luxury purposes, and a cut in military expenditures. All the economists mentioned favor an adequate fund for “direct employment in useful civic tasks for those who cannot find jobs”—an idea that Mr. Ford, who is a practical man, may find acceptable. As Vice President he fixed 5.5 percent unemployment as the cut-off point, after which a new employment policy would be necessary. Since we are close to that figure, the President may soon have to consider expanded public service employment to maintain incomes and, as the economists put it, to “preserve work habits and self-respect.”

Apart from the economy, there’s the pressing, unfinished business of Watergate. Among the most urgent is stricter accountability of federal intelligence agencies—the CIA and the FBI—so that they may not so easily again be manipulated for partisan purposes by the White House staff. Congress has been scandalously remiss in exercising its oversight responsibility for the Central Intelligence Agency. And during the long reign of J. Edgar Hoover the FBI was a fiefdom about which few questions dare be asked. Congress and the executive have before them recommendations of the Senate Watergate committee, which were dimmed by the drama of impeachment proceedings, Mr. Nixon’s resignation and the swearing in of Mr. Ford. Some, not all, of those recommendations deserve to be implemented, including one that would protect the confidentiality of tax returns and bar White House “investigative or intelligence-gathering activity concerning national domestic security not authorized by Congress.”

The growth of executive power, the influence of large and infrequently political appointees with allegedly independent agencies, the remoteness, high-handedness, and irresponsibility of government—all these had their part in the Watergate horrors. In the wake of a year and a half of disclosures, culminating in Mr. Nixon’s final damning revelations, public and congressional pressure for reform of the political system has produced a whole new legislative agenda with which the new president must deal. It took the hanky-panky perpetrated with CREEP’s swollen treasury to get Congress upset enough to come near to agreeing on reform of the way federal campaigns are financed. Three major approaches are being explored: curbing candidates’ total expenditures, curbing the contributions of each individual and organizational source of funds, and matching private political contributions with public subsidies. The bills adopted this year by the Senate and by the House combine all three approaches. There are fairly strict limits on specific donations and on total expenses, as well as public financing for presidential primary and general election campaigns and party conventions. This ought to ensure an end to “laundered” checks, secret contributions in cash and shakedowns of corporate executives. A final bill is being worked out among House and Senate conferees and will be ready for President Ford’s action in three weeks or so. The intended political prophylactic will reinforce what Congress, the courts, the press and public opinion have already done to curb abuse of power by the White House.

Another change, less publicized than the campaign measure, is also emerging from conference committee and will soon reach the President. This is a package of amendments to the 1966 Freedom of Information Act, the first revisions in that act to open up the workings of the federal bureaucracy to easier inspection by anyone. Most of the amendments are noncontroversial—preventing bureaucrats from delaying and frustrating legitimate requests by citizens for government reports and other documents. The hot debate is over an amendment by Sen. Philip Hart (D, Mich.) to broaden citizen access to FBI and other law enforcement files. When faced with requests for documents under the Freedom of Information Act, many agencies have claimed the requested material fell into the category of “investigatory files compiled for law enforcement purposes,” which the 1966 act specifically exempts from disclosure—and the courts have usually respected that exemption. Sen. Hart would require the FBI, for example, to show why disclosure would jeopardize an investigation, violate someone’s privacy, or interfere with the agency’s work. Though it was not in the House bill, the House conferees have accepted the Hart amendment. Sen. Roman Hruska (R, Neb.), however, is urging a veto largely because of it. Again President Ford may be forced to choose between the more “open administration” he has in mind and the desires of the federal law enforcers, or find some middle ground.

Finally a special Senate committee on national emergencies is preparing legislation to curb such executive abuses of power as Mr. Nixon’s 1969-1970 secret bombing of Cambodia. In the past Mr. Ford has opposed any limit on presidential discretion to take action in foreign affairs or to conduct an undeclared war, and in his address to the Congress he went so far as to claim that the Constitution commands us all to uphold the President when he speaks “to the world”!

So where are we? Two weeks ago, the Republicans had nowhere to go but down, steeply and quickly beginning this November. Mr. Nixon has handed his party not a pardon, but a reprieve. The Republicans are given another chance to appear respectable and modern. They need not defend, nor need President Ford, policies or practices of the past with which many of them have been identified.

The Democrats are in a somewhat awkward position. Although they could not publicly say so, from a partisan point of view, the worst meant the better: Mr. Nixon was to be their guarantor of spectacular gains this November and then in 1976. The guarantor has gone. He is no loner there to kick around or to kick others around, and the Democrats perforce become partisans of constructive cooperation.

But it would not be useful or in character for the Democratic party to become a silent partner, a mindless captive of the President’s wholesome bid for unity. Indeed Mr. Ford has made a point of “not asking for conformity; I am dedicated to the two-party system.” The Democratic majority does not need to be prodded into supporting Secretary Kissinger’s policies, endorsed by the President, of peaceful accommodation with Communist nations and collaboration with traditional allies. It may need to be prodded into finding its identity elsewhere, in the realm of economic management, environmental protection, stricter control of the military budget, wider opportunities for all classes and races, greater equity in incomes and better incentives to earn and save. Meanwhile Democrats in the Senate who have been campaigning for the presidential nomination in 1976 will perhaps find it to their interest to concentrate on the duties of legislating, at least for the rest of the year.

This article originally ran in the August 24, 1974, issue of the magazine.